The Food Travel Experts/media/Files/S/...Group financial overview SSP: The Food Travel Experts Change (%) £m H1 2019 H1 2018 Constant Currency Reported FX Rates Revenue 1,261.6 1,177.8

www.foodtravelexperts.com

The Food Travel Experts

Presentation structure

1. Group highlights Kate Swann

2. Financial review Jonathan Davies

3. Business review Simon Smith / Kate Swann

4. Q&A All

SSP: The Food Travel Experts2

Group highlights

• Good first half performance with operating profit up 14.6% at constant currency and 13.2% at actual exchange rates

• Total sales growth including acquisitions 6.8%*

• Like for Like sales up 2%

• Net new space growth strong at 4.1%

• Strong operating margin growth of 30bps

• EPS 6.7p, up 19.6% YOY

• Interim dividend 5.8p, up 20.8% YOY

• Medium term pipeline encouraging


* At constant currency

Financial review

SSP: The Food Travel Experts

Jonathan Davies, CFO

Interim Results 2019

Group financial overview


Change (%)

£m H1 2019 H1 2018Constant Currency

Reported FX Rates

Revenue 1,261.6 1,177.8 6.8% 7.1%

LFL Sales Growth 2.0% 2.8% n/a n/a

Operating Profit* 62.5 55.2 14.6% 13.2%

Profit Before Tax* 54.2 48.7 n/a 11.3%

Earnings per share (p)* 6.7 5.6 n/a 19.6%

Net Debt (433.4) (290.1) n/a 49.4%

5

*Excludes amortisation of intangible assets created at acquisition of the SSP business by EQT in 2006 and the revaluation of the final consideration to acquire an additional 16% of TFS.

H1 2019 LFL sales growth 2.0%


0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

4.5%

H1 H2 FY18 Q1 Q2 H1

Note: Same store like-for-like sales growth at constant currency

LFL

Sale

s G

row

th (

%YO

Y)

FY18 H1 FY19

2.8%

6

2.7% 2.8%2.5%

1.5%

2.0%

Revenue growth of 6.8% at constant currency


Change at Constant Currency LFL SalesNet Contract

Gains/(Losses)Total

Revenue

UK 1.4% 2.9% 4.3%

Continental Europe (0.8)% 3.1% 2.3%

North America 5.4% 8.7% 14.1%

Rest of World (inc India) 6.4% 4.2% 10.6%

Group 2.0% 4.1% 6.1%

Acquisition Impact

Stockheim 0.7%

Reported Growth 6.8%

7

Operating profit growth of 14.6% at constant currency


Operating Profit* Change (%)


Reported FX Rates

UK** 39.1 33.4 17.4% 17.1%

Continental Europe 17.7 21.8 (15.3)% (18.8)%

North America 9.5 6.4 51.6% 48.4%

Rest of World 15.9 13.6 16.3% 16.9%

Non-attributable (19.7) (20.0) 1.5% 1.5%

Group 62.5 55.2 14.6% 13.2%

* Operating profit is underlying, at actual currency** UK includes Republic of Ireland

8

Operating profit margin up by 30bps


YOY bps Change


Reported FX Rates

Revenue 1,261.6 1,177.8

Gross Profit% Sales

892.270.7%

821.569.8% 90 90

Labour Costs% Sales

385.130.5%

356.730.3% (20) (20)

Concession Fees% Sales

248.619.7%

222.318.9% (80) (80)

Overheads% Sales

143.211.4%

139.611.9% 50 50

Depreciation & Amortisation*

% Sales

52.84.2%

47.74.1% (10) (10)

Operating Profit*

Operating Margin (%)

62.55.0%

55.24.7% 30 30

9

*Excludes amortisation of intangible assets created at acquisition of the SSP business in 2006 and the revaluation of the final consideration to acquire an additional 16% of TFS.

Net profit up 16.0%


£m H1 2019 H1 2018 Change (%)

Operating Profit* 62.5 55.2 13.2%

Net Financing Cost* (10.4) (6.7)

Share of Associates 2.1 0.2

Profit Before Tax* 54.2 48.7 11.3%

Tax* (12.0) (10.7)

Non-Controlling Interests (11.0) (11.1)

Net Profit* 31.2 26.9 16.0%

Earnings per share (p)* 6.7p 5.6p 19.6%

Dividend per share (p) 5.8p 4.8p 20.8%

10


Free cash outflow of £75.9m


£m H1 2019 H1 2018

Operating Profit* 62.5 55.2

Depreciation & Amortisation* 52.8 47.7

Working Capital (36.3) (0.5)

Capital Expenditure (108.2) (61.5)

Net Tax (18.7) (17.6)

Acquisition (3.4) (18.8)

Other (18.5) (4.5)

Operating Cash Flow* (69.8) (0.0)

Net Financing Costs (6.1) (6.1)

Other 0.0 (0.4)

Free Cash Outflow* (75.9) (6.5)

11


Net debt of £433.4m


H1 2019 H1 2018

£mLeverage

(NetDebt/EBITDA)

£mLeverage

(NetDebt/EBITDA)

Opening Net Debt (1 October) (334.7) 1.1x (262.2) 1.0x

Free Cash Flow (75.9) (6.5)

Dividend (25.2) (23.5)

Impact of foreign exchange rates 8.2 2.3

Other (5.8) (0.2)

Closing Net Debt (31 March) (433.4) 1.4x (290.1) 1.1x

12

Financial summary

• Robust LFL sales growth of 2.0%

• Net contract gains strong at 4.1 %

• Acquisitions add a further 0.7%

• Operating profit up 14.6 % at constant currency

• Strategic programmes delivering strong operating margin growth up 30bps

• EPS up 19.6%

• Interim dividend per share of 5.8p, up 20.8%


Business Review


Simon Smith, CEO Designate


SSP business fundamentals

• Multiple structural market growth drivers

• Market leader in attractive channels and regions

• Strong business platform combining international scale and local expertise

• 5 key levers to drive growth and efficiency

• Sales growth, margin expansion and strong cash generation


Regional progress update


• Revenue growth in all regions

• Geographic diversification continues as planned

• Fast growth in North America and ROW, now 33% of the Group

• Further opportunities to grow in all regions

• Encouraging new business pipeline underpinning future revenue growth

*Note: figures included in graphs all at constant currency

Channel progress update


• Good PAX growth in air

• Air sector now 63% of SSP

• Geographic growth will continue to drive air mix

• Rail growth, slower impacted by disruption

• Medium term growth forecasts in travel remain encouraging

*Note: figures included in graphs all at constant currency

Our focus remains on five key levers to deliver value


1 Optimise our offer to benefit from the positive trends in our markets

Grow profitable new space

Optimise gross margin and leverage scale benefits

Run an efficient and effective business

Optimise investment using best practice and shared resource

2

3

4

5

18

Optimising our offer

• LFL growth of 2.0%

• Geographic diversification helps mitigate specific country issues

• Variability in LFL growth usual

• Underlying medium term positive trends in travel market

• Strategic initiatives delivering well


Areas of Focus

Improve ranges

Optimise price and promotion

Upselling

Maximise use of space

Focus on category as well as brand performance

1

19

Optimising our offer: Technology to drive LFL

• Self-scan tills ⁻ Now 275 tills rolled out

⁻ Higher volumes

• Self-order kiosks⁻ Now 200 kiosks rolled out

⁻ Reduce queues and congestion

• Mobile ordering pilot⁻ Scan QR code to order from table

⁻ Serve more customers, more quickly

⁻ Labour more efficiently deployed


Grow profitable new space

• Strong performance, 4.1% net gains

• New contracts/openings will materially differ from year to year

• Impact on P&L in first year varies based on type and timing of openings

• Disciplined approach to new business

• Renewal rate in line with plan

• Pipeline encouraging for 2020 and beyond


Areas of Focus

New units within existing sites

Existing markets, new sites

New markets

High renewal rate

2

21

Growing profitable new space - North America


• Significant growth already delivered since IPO:

• Well established, credible player, strong momentum

• Significant future opportunity: food & beverage market in North America large and growing:‐ Growing PAX numbers‐ Airports increasing share of F&B‐ Desire for greater competition at airports‐ Desire for improved food and beverage offer ‐

• SSP present in only 25 out of the top 80 US airports

H1 2014 H1 2019 % change

Units 204 325 +60%

Revenue £78m £236m +203%

Chicago Midway

San Francisco

LAX

Portland

Recent new business wins yet to open


• Significant recent wins still to open with over 80 units planned

• Including 48 units won in H1 2019

• Local approach successful

• Strong brand line up

• Substantial further pipeline

New YorkOakland

Vancouver

Salt Lake City

Bermuda

Ottowa

Boston

Indianapolis

Miami

Toronto

Montreal

Phoenix

Seattle

Wins where units have yet to open

Strong progress globally on new contract wins - including:


H1 Contract Wins

SSP presence

Key:

New York5 units

St Petersburg4 units

Oakland8 units

Vancouver7 units

Salt Lake City6 units

Alicante6 units

Brussels4 unitsParis

12 units

Helsinki4 units

Athens4 units

Mumbai3 units

UK4 units

Singapore2 units

Bermuda3 units

Delhi9 units

Seville4 units

Brisbane5 units

Ottowa10 units

Salvador7 units

Further progress optimising gross margin

• Gross margin improved by 90bps

• Continued increase in food inflation

• Key initiatives continue to deliver good results

• Good progress on simplification and standardisation


Areas of Focus

Procurement disciplines

Simplify and standardise recipes

Reduce waste and losses

3

25

Gross margin: Supply Chain Initiatives


• Complex supply chain

• Opportunity to review end to end process

• Early opportunities identified

• Delivery frequency analysed:⁻ Negotiated with suppliers to increase volume

delivered and reduce number of drops⁻ Shared cost saving benefits with supplier⁻ Standard methodology developed

• Rolling out in UK, global plan being trialled

Encouraging progress on operating efficiency

• Net operating efficiency improves 30bps

• Labour costs up 20bps

• Other overhead costs 50bps improvement

• Labour cost pressures continue as expected


4

Areas of Focus

Service optimisation

Improve forecasting and scheduling

Employ technology to improve efficiency

Improve reporting and accountability

27

Operating Efficiency: Further outsourcing

• Part of our ongoing outsourcing programme

• Identified multiple approaches to unit design across group – costly and inefficient

• Established a design agency in India to deliver drawings for low complexity schemes

• On the first 20 UK scheme savings of almost c. 40% identified

• International schemes now being included and more complex/ higher capex schemes will be trialled


Ritazza, Belfast Airport

Looking ahead…….

• Excellent progress in driving commercial excellence in the UK, we can do much more of this around the world

• Significant market opportunity: North America and ROW

• Technology and automation offer lots of opportunity both in top line growth and cost optimization

• Many other areas, for example maintenance and inventory management have only seen limited work to date

• Expect continued good progress across the P&L as we focus on our many, many opportunities


Summary and outlook

• Strong financial performance, profit up 14.6% at constant currency, 13.2% at actual exchange rates

• Solid LFL sales up 2%

• Net new openings ahead of plan at 4.1%

• Good progress on margin and efficiency, operating margin growth of 30bps

• EPS 6.7p, up 19.6%

• Half year dividend of 5.8p, up 20.8% YOY; special dividend executed in April

• Pipeline encouraging, continued investment in profitable new contracts

• Second half has started well

• Focus on delivering value for our shareholders


Q&A



DisclaimerCertain statements in the presentation may constitute “forward-looking statements”. These statements reflect the Company’s current beliefs and expectations and are based on numerous assumptions regarding the Company’s present and future business strategies and the environment the Company and members of its group will operate in and are subject to risks and uncertainties that may cause actual results, performance or achievements to differ materially. Forward-looking statements involve inherent known and unknown risks, uncertainties and contingencies because they relate to events and depend on circumstances that may or may not occur in the future and may cause the actual results, performance or achievements of the Company to be materially different from those expressed or implied by such forward looking statements.

Many of these risks and uncertainties relate to factors that are beyond the Company’s ability to control or estimate precisely, such as future market conditions, currency fluctuations, the behaviour of other market participants, the actions of regulators and other factors such as the Company’s ability to continue to obtain financing to meet its liquidity needs, changes in the political, social and regulatory framework in which the Group operates or in economic or technological trends or conditions. As a result, you are cautioned not to place undue reliance on such forward-looking statements. Additionally, forward-looking statements regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Forward-looking statements speak only as of their date and the Company, any other member of the Group, its parent undertakings, the subsidiary undertakings of such parent undertakings, and any of such person’s respective directors, officers, employees, agents, affiliates or advisers expressly disclaim any obligation to supplement, amend, update or revise any of the forward-looking statements made herein, except where it would be required to do so under applicable law or regulatory obligations. It is up to the recipient of this presentation to make its ownassessment as to the validity of such forward-looking statements and assumptions. Nothing in this presentation shall exclude anyliability under applicable laws that cannot be excluded in accordance with such laws.


Documents

The Food Travel Experts/media/Files/S/...Group financial overview SSP: The Food Travel Experts Change (%) £m H1 2019 H1 2018 Constant Currency Reported FX Rates Revenue 1,261.6 1,177.8